Choosing between a private vs public company in Nepal is one of the most important early decisions for foreign companies entering the Nepalese market. The choice affects registration costs, compliance burden, ownership flexibility, and long-term scalability.
Nepal has become increasingly attractive for foreign investors due to competitive labor costs, English-speaking talent, and improving digital registration systems. However, many overseas founders underestimate how differently private and public companies are regulated and priced.
This guide offers a practical, cost-focused comparison written specifically for foreign companies. It reflects Nepal’s legal framework, market practice, and investor expectations, helping you decide the most efficient structure from day one.
Under the Companies Act 2006, Nepal recognizes two main for-profit company types relevant to foreign investors: private limited companies and public limited companies.
A private company in Nepal is designed for closely held businesses and foreign subsidiaries.
Key characteristics:
Maximum 101 shareholders
Share transfer restrictions
No public share issuance
Lower disclosure obligations
Most foreign investors register private limited companies as wholly owned subsidiaries or joint ventures.
A public company is structured for large-scale capital raising.
Key characteristics:
Minimum 7 shareholders
Can issue shares to the public
Higher paid-up capital
Mandatory audits and disclosures
Public companies are commonly used for banks, hydropower projects, insurance companies, and large infrastructure investments.
Understanding the legal distinction is critical before comparing costs.
Private company: Full control possible for foreign parent entities
Public company: Ownership diluted by public shareholders
Private company: Flexible capital, often NPR 100,000–1,000,000
Public company: Typically NPR 10 million or more
Private company: Light to moderate
Public company: Heavy, continuous regulatory oversight
Registration costs in Nepal are driven by authorized capital, not revenue. This makes structure selection financially significant.
Company registration fees are paid to the Office of Company Registrar.
| Authorized Capital | Private Company Fee (NPR) | Public Company Fee (NPR) |
|---|---|---|
| Up to 1 million | 1,000–4,500 | Not applicable |
| 1–10 million | 9,500–16,000 | 15,000–30,000 |
| Above 10 million | Scaled progressively | Significantly higher |
Insight: Public companies pay higher fees even at the same capital threshold.
Foreign investors usually require professional support beyond government fees.
Legal structuring and documentation
Certified translations
Tax registration and compliance setup
Foreign investment approval coordination
Estimated ranges:
Private company: USD 1,000–2,500
Public company: USD 3,500–7,000+
While the law allows flexibility, regulators and banks apply practical thresholds.
Foreign-owned private companies usually register with:
NPR 1–5 million authorized capital
Aligned with visa, banking, and operational credibility
Public companies generally require:
NPR 10–100 million capital
Sector-specific approvals (energy, finance, telecom)
Registration is only the beginning. Ongoing compliance determines real cost.
Annual return filing
Basic statutory audit
Tax filings
Estimated annual cost: USD 800–1,500
Statutory audit by licensed auditor
Public disclosures
AGM and shareholder reporting
Regulator coordination
Estimated annual cost: USD 3,000–6,000+
| Factor | Private Company | Public Company |
|---|---|---|
| Registration cost | Low | High |
| Capital requirement | Flexible | High |
| Compliance cost | Moderate | Heavy |
| Foreign ownership | Simple | Complex |
| Best for | Subsidiaries, SMEs | Large projects |
A private company is ideal if you:
Want full control
Are entering Nepal for services, IT, or outsourcing
Need cost efficiency
Do not plan public fundraising
Most foreign service companies, back-office operations, and tech firms choose this route.
A public company may be appropriate if you:
Require large local capital
Operate in regulated sectors
Plan IPO or public share issuance
For most foreign SMEs, this structure is unnecessarily expensive.
Name reservation
Document preparation
OCR submission
PAN and tax registration
Bank account setup
This process typically takes 7–14 working days with proper documentation.
Both private and public companies face:
Corporate tax (generally 25%)
VAT if applicable
Withholding tax obligations
Public companies may face additional scrutiny during tax assessments.
Over-capitalizing unnecessarily
Choosing a public company too early
Ignoring compliance costs
Underestimating documentation requirements
A well-structured private company avoids most of these pitfalls.
This article is based on:
Nepal’s Companies Act 2006
OCR registration practices
Professional experience supporting foreign investors
Market-standard compliance benchmarks
Always confirm sector-specific rules before finalizing your structure.
For most foreign investors, the private vs public company in Nepal decision is clear. A private company offers lower registration costs, simpler compliance, and full ownership control. Public companies are best reserved for large-scale, capital-intensive projects.
Choosing the right structure from the start saves money, time, and regulatory risk.
Need help registering your company in Nepal?
Speak with a local expert to structure your investment correctly from day one.
For most foreign investors, yes. Private companies are cheaper, easier to manage, and allow full control.
There is no strict minimum, but NPR 1–5 million is common for foreign-owned entities.
Yes, subject to sector rules and foreign investment approvals.
Only in regulated sectors or when public fundraising is required.
Typically 7–14 working days for private companies.